The London Fog Group, parent company to Pacific Train, Moonstone, Pac Tec, Black Dot Clothing, and Northern Exposure, filed for Chapter 11 bankruptcy as a result of the group being unable to secure sufficient working capital and other financing to properly fund its operations.
Moving forward, the company will only operate its London Fog luxury apparel brand and Homestead home textile business. The brands under the Pacific Trail umbrella will be auctioned off. The London Fog Group is currently in an asset purchase agreement with Perry Ellis International, as a “stalking horse” bidder, to acquire the Pacific Trail brands for $14.5 million, subject to due diligence.
David Collins, spokesperson for London Fog, told SEW that the $14.5 million is a price that simply demonstrates there is a viable bidder and the auction process will determine the final price. The company is hoping for a final price tag that is “significantly more.” The auction includes Pacific Trail, Pac-Tech, Town, Moonstone, and Outdoor Unlimited by Pacific Trail. All of the brands will be sold together in one package.
The Moonstone brand, in particular, was in the middle of a transition period, rebuilding its dealer base and brand equity after several years of relative inactivity. In January of 2004, Pacific Trail announced that Moonstone opened its 200th door, and throughout the rest of that year, the brand was able to increase that number to 300 doors. However, this momentum seems to have slowed more recently.
SEW caught up with Todd Gilmer, marketing director of The London Fog Group, shortly before the Bankruptcy filing. He said that the company launched a ski-focused line at OR Winter Market to help spur more growth, and door growth was flat over last year.
